Annual Report 2007

COX & KINGS (INDIA) PRIVATE LIMITED 67TH ANNUAL REPORT BOARD OF DIRECTORS A. B. M. Good Peter A. Kerkar Pesi S. Patel Urrshila Kerkar Arup Sen Mr. Sam Tully Mr. M. Narayanan AUDITORS M/s. Chaturvedi & Shah Chartered Accountants BANKERS State Bank of Patiala BRANCHES Mumbai New Delhi Jaipur Bangalore Chennai Hyderabad Kochi Kolkata Goa Andheri Pune Ahmedabad Nagpur Russia New York REGISTERED OFFICE 1st Floor, Turner Morrison Building 16 Bank Street, Fort, Mumbai-400 023 www.coxandkings.com Chairman Director Director Director Director Director Director

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DIRECTORS REPORT To the Members, Your Directors have pleasure in presenting the Sixty Seventh Annual Report, together with the Balance Sheet and Profit and Loss Account for the year ended 31st March 2007. A. FINANCIAL RESULTS Particulars Revenues Profit before Tax Provision for Tax Provision for Deferred Tax Provision for Fringe Benefit Tax Profit After Tax 9,151 3,280 1,245 (71) 52 2,053 7,423 2,323 951 (180) 62 1,491 (Rs. in Lakhs) Year ended 31st March 2007 Year ended 31st March 2006

OPERATIONS & RESULTS: The global growth rate for Travel & Tourism Industry during the year 2006-07 has been extremely good. This is reflective of the Companys financial performance for the Financial Year 2006-07. The business outlook for the year ahead is expected to be positive. DIVIDEND: Your Directors are pleased to recommend for approval of the shareholders, dividend @ 7 % on the paid up share capital of Rs. 5,44,00,00/- as on 31st March 2007 in respect of the financial year 2006-07. The dividend, if declared as above, would involve an outflow of Rs. 38,08,000/- towards dividend and Rs. 534072/- towards dividend tax, resulting in a total outflow of Rs. 4342072/. CHANGE OF NAME Pursuant to the Special Resolution passed by the shareholders of the Company on 29th January 2007, the status of the company has changed from Private Limited to Public Limited Company. A fresh Certificate of Incorporation was received from the Registrar of Companies dated 28th March 2007 pursuant to the change of the company from Cox & Kings (India) Private Limited to Cox and Kings (India) Limited. ALTERATION OF MAIN OBJECT CLAUSE OF THE COMPANY: Pursuant to the Special Resolution passed by the shareholders of the Company on 29th January 2007, the Main Object Clause of the company was altered to include foreign exchange and insurance business. The certificate was issued on 29th March 2007. SUBSIDIARY COMPANIES During the year under review, your company has invested in two overseas subsidiaries i.e. CNK Internet Pte. Ltd, incorporated in Singapore and Cox & Kings Tours LLC incorporated in Dubai. The Audited Statement of Accounts of Clearmine Limited U.K. and ETN Services Limited U.K. are separately attached as required under the provisions of Section 212 of the Companies Act 1956 SETTING UP OF BRANCH OFFICE AT NEW YORK, RUSSIA With the view to expand the operation the Company and to embark global presence, your company has established overseas branches at Russia and New York. They will add synergy to the Companys operations. APPROVAL FROM FOREIGN INVESTMENT PROMOTION BOARD An application dated June 26 2007 was made by your company to Foreign Investment Promotion Board (FIPB) to seek its approval to acquire the entire share capital comprising of 1,427,875 issued, subscribed and fully paid up ordinary shares of 1 each of Cox & Kings Ltd U.K., and 41.16% share capital comprising of 247 issued, subscribed and fully paid up ordinary shares of Yen 50,000 each of Cox & Kings (Japan) Ltd. FIPB has approved the same through letter dated 6th August 2007.

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Pursuant to the approval by FIPB, your Company acquired 100% paid up capital of Cox & Kings Ltd U. K. (making it as the wholly owned subsidiary) and 41.16% paid up capital of Cox & King (Japan) Ltd. DEMAT OF SHARES Your Company has entered into a Tripartite Agreement with National Securities Depository Limited and Central Depository Services (India) Ltd and accordingly the shares have been admitted for demat by both the depositiories to enable the shareholders to hold their shares in dematerialised form. DIRECTORS In accordance with Article 125 of the Articles of Associations of the Company Ms Urrshila Kerkar and Mr. Arup Sen retire by rotation and being eligible, offer themselves for re appointment. Mr. P. K. Nagarajan resigned from the Board with effect from 16 May 2007. The Board placed on record appreciation for the valuable services rendered by Mr. Nagarajan. Mr. M. Narayanan and Mr. Sam Tully were appointed as Additional Director of the company with effect from 13th June 2007, They holds office upto the date of this Annual General Meeting and in this respect, the Company has received notice in writing under section 257 of the Companies Act 1956 from member proposing his candidature for the office of Director of the Company at the forthcoming Annual General Meeting. CODE OF CONDUCT FOR MANAGEMENT AND SENIOR The Company had also evolved and adopted a Code of Conduct for its Board of Directors and Senior Management based on the principles of Good Corporate Governance and best management practices effective from 27th July, 2007. The declaration of compliance with the Code of Conduct has been received from all Board Members and Senior Management personnel. BOARD COMMITTEES During the year under review three committees of the Board were constituted. Audit Committee: This committee was constituted by the Board of Directors at its meeting held on 27th July 2007 consisting of Mr. Sam Tully as chairman and Mr. ABM Good, Mr. M. Narayanan and Mr. Pesi Patel as members respectively. Shareholders/Investors Grievances Committee: This committee was constituted by the Board of Directors at its meeting held on 27th July 2007 consisting of Mr. Pesi Patel as chairman and Mr. ABM Good, Mr. M. Narayanan , Mr. Sam Tully and Mr. Peter Kerkar as members respectively. Remuneration Committee: This committee was constituted by the Board of Directors at its meeting held on 27th July 2007 consisting of Mr. Sam Tully as chairman and Mr. ABM Good, Mr. M. Narayanan and Mr. Pesi Patel as members respectively. AUDITORS RSM & Co, Statutory Auditors of the Company, have resigned vide letter dated May 17th 2007. The resignation is effective from 31st March 2006. M/s. Chaturvedi & Shah, Auditors have consented to act as the Auditors of the Company. They have given a certificate to the effect that the appointment, if made, would be within the provisions of section 224(1B) of the Companies Act 1956. FIXED DEPOSITS During the year under review, the Company has not accepted any deposit under Section 58A of the Companies Act, 1956, read with Companies (Acceptance of Deposits) Rules, 1975. No amount of principal or interest was outstanding as on the Balance Sheet date. DIRECTORS RESPONSIBILITY STATEMENT Pursuant to the provisions of Section 217 (2AA) of the Companies Act, 1956, with regard to Directors Responsibility Statement, it is hereby confirmed that : i) In the preparation of annual accounts for the period ended on 31 March, 2007, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii) The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31 March, 2007 and of the profit of the Company for the year ended on that date;

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iii) The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; iv) The Directors had prepared the accounts for the financial year ended 31 March, 2007 on a going concern basis. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO The Company has no activity relating of conversation of energy or technology absorption. The figures for the foreign exchange earnings and outgo are as follows; Foreign Exchange Earnings: Rs. 629,435,952/- (Previous Year- Rs. 630,793,297) Foreign Exchange Outgo: Rs. 20,142,529/(Previous Year- Rs. 13,694,399) PARTICULARS OF EMPLOYEES Information as per the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended are annexed herewith and form part of this Report. AUDITORS REPORT The Board has duly examined the Statutory Auditors Report to accounts and the clarifications, wherever necessary, have been included in the Notes to Accounts, section of Annual Report. ACKNOWLEDGEMENT Your Directors place on record their appreciation of the support and co-operation received from the employees for their contribution to the growth and success of the Company. Your Companys consistent growth has been made possible by their hard work, service excellence, solidarity, co-operation, commitment and support. Your Directors also express their deep sense of gratitude to our Customers, Business Partners, Associates, Banks & Financial Institutions, Suppliers, Solicitors, Advisors and all our well wishers for their continuous guidance and support. Place: Mumbai. Date: September 12, 2007 Registered Office: 1st Floor Turner Morrison Building 16 Bank Street, Fort, Mumbai-400 001 On behalf of the Board of Directors DIRECTOR

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Annexure to the Directors Report Information pursuant to Section 217 (2A) of the Companies Act 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended and forming part of Directors Report for the financial year ended 31st March 2007. Sr. No Name of Employee Designation Age Remuneration received Qualification Experience no. of years Date of Commencement of Employment Last employment held t

Ms. Urrshila Kerkar

Director

48

36,00,000/-

B.A. Hons

25

01.12.2004

Business

Place: Mumbai. Date: September 12, 2007 Registered Office: 1st Floor Turner Morrison Building 16 Bank Street, Fort, Mumbai-400 001

On behalf of the Board of Directors DIRECTOR

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AUDITORS REPORT The Members of COX AND KINGS (INDIA) LIMITED We have audited the attached balance sheet of COX AND KINGS (INDIA) LIMITED as at March 31, 2007, the Profit and Loss Account and also the Cash Flow Statement for the year ended on that date. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit. 1. We have conducted our audit in accordance with the Auditing Standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. 2. As required by the Companies (Auditors Report) Order 2003 (as amended) issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order. 3. Further to our comments in the Annexure referred to above, we report that: a) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit; b) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books; c) The Balance Sheet, the Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account; d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow statement dealt with by this report comply with the mandatory Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956; e) On the basis of written representations received from the Directors as on March 31, 2007 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2007 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956; f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Significant Accounting Policies and other notes thereon give the information required by the Companies Act, 1956, in the manner so required, and present a true and fair view in conformity with the accounting principles generally accepted in India: (i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2007; (ii) in the case of the Profit and Loss Account, of the Loss for the year ended on that date; and (iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date. For Chaturvedi & Shah Chartered Accountants Rajesh D. Chaturvedi Partner Membership No.: 45882 Place: Mumbai Date : September 12, 2007

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Annual Report 2007

Annexure referred to in paragraph 2 of our report of even date 1. a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets. b) As explained to us, all the fixed assets have been physically verified by the management in a phased periodical manner, which in our opinion is reasonable, having regard to the size of the Company and nature of its assets. No material discrepancies were noticed on such physical verification. c) In our opinion, the Company has not disposed off substantial part of its fixed assets during the year and the going concern status of the Company is not affected. 2. In respect of its inventories: a) The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable. b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business. c) The Company has maintained proper records of inventory. As explained to us, there were no material discrepancies noticed on physical verification of inventory as compared to the book records. 3. In respect of loans, secured or unsecured, granted by the company to companies, firms or parties covered in the register maintained under section 301 of the Companies Act, 1956: a) The Company has granted unsecured loan to five parties covered in the reqister maintained under section 301 of the ompanies Act, 1956 aggregating to Rs.67,492,294/- and maximum amount outstanding at any time during the year is Rs. 67,492,294/b) According to the information and explanations given to us, the rate of interest (where stipulated) and other terms and conditions of such loans are prima facie not prejudicial to the interest of the Company. c) According to the information and explanations given to us, the said loans and the interest thereon are repayable on demand and therefore the question of overdue amount does not arise. 4. The Company has not taken any loan, secured or unsecured to/from companies, firms and other parties covered in the Register maintained under Section 301 of the Companies Act, 1956 to be entered in the register maintained under Section 301 of the Companies Act, 1956. 5. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and also for the sale of services. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas. 6. According to information and explanation given to us there are no contracts or arrangements referred to Section 301 of the Act during the year that need to be entered in the register maintained under that section of the Companies Act, 1956. Accordingly, clause (v) of paragraph 4 of the Order is not applicable to the company for the current year. 7. The Company has not accepted any deposit from the public. Accordingly, clause (iv) of paragraph 4 of the Order is not applicable to the company for the current year. 8. In our opinion, the Company has an internal audit system commensurate with the size and nature of its business. 9. To the best of our knowledge and according to the information and explanation provided to us, the Central Government has not prescribed the maintenance of cost records under Section 209 (1) (d) of the Companies Act, 1956. 10. In respect of statutory dues: a) According to the records of the Company, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and any other statutory dues, have been generally regularly deposited with the appropriate authorities except for few cases. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March, 2007 for a period of more than six months from the date of becoming payable except a sum of Rs.6020 in respect of Investor Education and Protection Fund.

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b) According to the information and explanation given to us, there are no dues of sales tax, income tax, wealth tax, service tax, custom duty, excise duty and cess which have not been deposited on account of any dispute, except as stated below: Name of the Statute Income Tax Act, 1961 Nature of Dues Income Tax Amount 28,001,793 Forum where the dispute is pending Commissioner of Income Tax (Appeals)

11. The Company does not have accumulated losses at the end of the financial year. The Company has not incurred cash losses during the financial year covered by the audit and in the immediately preceding financial year. 12. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions, banks or debenture holders. 13. In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted on the basis of security by way of pledge of shares, debentures and other securities. 14. In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/ society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors Report) Order 2003, (as amended) are not applicable to the Company. 15. The Company has maintained proper records of transactions and contracts in respect of dealing and trading in other investments and timely entries have been made therein. All the investments have been held by the Company in its own name. 16. According to information and explanation given to us the Company has not given any guarantee for loans taken by others from bank or financial institutions. Therefore, the provisions of clause (xv) of the Order are not applicable to the Company. 17. Based on information and explanations given to us by the management, the term loans raised have been applied for the purpose for which they were raised. 18. The Company has not used funds raised on short-term basis for long term investment. 19. The Company has not made any preferential allotment of shares to parties and companies covered under Register maintained under section 301 of the Companies Act, 1956. 20. During the year company has issued debentures. As per the information and explanation given to us, the debentures are secured by personal guarantee of director. 21. The Company has not raised any monies by way of public issue during the year. 22. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the year. For Chaturvedi & Shah Chartered Accountants Rajesh D. Chaturvedi Partner Membership No.: 45882 Place: Mumbai Date : September 12, 2007

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Annual Report 2007

COX & KINGS (INDIA) LIMITED Balance Sheet As At March 31, 2007 Schedule No. SOURCES OF FUNDS Shareholders Funds Share Capital Reserves & Surplus Loan Funds Secured Loans Unsecured Loans Total APPLICATIONS OF FUNDS Fixed Assets Gross Block Less : Depreciation/Amortisation Net Block Capital Work In Progress and Advances Investments Deferred Tax Assets (Net) (Refer note 7 of Schedule 14) Current Assets, Loans & Advances Inventories Sundry Debtors Cash & Bank Balances Loans & Advances Less : Current Liabilities and Provisions Current Liabilities Provisions Net Current Assets Miscellaneous Expenditure (To the extent not written off or adjusted) Total Notes to Accounts As per our attached report of even date For Chaturvedi & Shah Chartered Accountants Rajesh D. Chaturvedi Partner Place: Mumbai Date : September 12, 2007 As At 31.03.2007 Rupees Rupees As At 31.03.2006 Rupees Rupees

1 2 3

54,400,000 693,819,747 748,219,747 272,066,305 300,000,000 572,066,305 1,320,286,052

54,400,000 492,765,263 547,165,263 457,462,938 185,900,000 643,362,938

1,190,528,201

4 258,342,902 126,057,837 132,285,065 5,677,662 137,962,727 617,067,235 12,279,834 6 18,945,410 740,757,950 154,155,144 944,034,769 1,857,893,273 7 1,025,604,608 279,312,409 1,304,917,017 8 552,976,256 1,320,286,052 14 For and on behalf of the Board 781,551,901 152,441,365 933,993,266 678,226,039 17,640,308
1,190,528,201

181,292,763 96,225,093 85,067,670 45,701,451 130,769,121 358,703,555 5,189,178 11,441,768 445,457,984 265,987,249 889,332,304 1,612,219,305

Urshila A. Kerkar Director Place: Mumbai Date : September 12, 2007

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Peter Kerkar Director

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COX & KINGS (INDIA) LIMITED Profit & Loss Account for Year ended March 31, 2007 Schedule No. INCOME Commission and Other Operating Income
Receipt on relinquishment of Tenancy Rights

For the year ended 31.03.2007 Rupees Rupees

For the year ended 31.3.2006 Rupees 631,714,135 84,850,000 25,735,617 Rupees

9 10

Other Income EXPENDITURE Personnel Expenses Other Expenses Interest and Finance Charges (Net) Depreciation Profit before tax for the year Less : Provision for Tax Current Deferred Fringe Benefit Tax Profit after tax for the year Less: Tax adjustments in respect of earlier years Profit after tax Add: Balance of Profit brought forward from previous year Profit available for appropriation Appropriation : Proposed Dividend [Re.0.7/- (Previous year Re. 0.7/-) per share] Tax on dividend Balance carried forward to Balance Sheet Notes to Accounts Earning per share - Basic and Diluted (Face value of Rs. 10 per share) (Refer note 8 of Schedule 14) As per our attached report of even date For Chaturvedi & Shah Chartered Accountants Rajesh D. Chaturvedi Partner Place: Mumbai Date : September 12, 2007

891,425,732 23,705,227 915,130,959

742,299,752 150,825,962 312,252,885 28,893,671 18,044,761

11 12 13

168,377,300 338,653,363 50,148,085 29,946,311 587,125,059 328,005,900 124,500,000 (7,090,656) 5,200,000 205,396,556 205,396,556 274,398,183 479,794,739 3,808,000 534,072 475,452,667

510,017,279 232,282,473 95,100,000 (18,039,718) 6,215,000 149,007,191 (124,980) 149,132,171 129,608,084 278,740,255 3,808,000 534,072 274,398,183 31.82

14 37.76

For and on behalf of the Board

Urshila A. Kerkar Director Place: Mumbai Date : September 12, 2007

Peter Kerkar Director

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CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2007 Cash Flow from Operating Activities 2009-07 (Rs) Profit before Tax 328,005,900 Adjustments For: Depreciation 29,946,311 Dividend Income Interest Income (21,382,531) Interest Expense 50,148,085 Loss on sale of Fixed Assets (Net) 168,090 Profit on sale of Investments (Net) Bad debts written off / provision for bad and doubtful debts Miscellaneous Expenditure written off 17,640,308 404,526,163 Operating profit before working capital changes Adjustments For: (Increase)/Decrease in Inventories (Increase)/Decrease in Trade Receivable (Increase)/Decrease in Loan and Advances Increase/(Decrease) in Current Liabilities Cash Generated from Operations Income Taxes Paid Net cash flow from operating activities Cash flow from Investing Activities Purchase of Fixed Assets Increase in Capital work in progress Sale of Fixed Assets Interest Received Dividend Received Proceeds from sale of Investments Purchase of Investments Net cash used in investing activities (7,503,642) (295,299,966) 85,454,437 171,860,174 359,037,166 (123,572,608) 235,464,558 (77,446,804) 40,023,789 115,000 4,798,245 (258,363,680) (290,873,450) (71,296,633) (4,342,072) (50,148,085) (125,786,790) (181,195,682) 237,359,271 56,163,589 (181,195,682)

2005-06 (Rs) 232,282,473 18,044,761 (11,183) (20,200,032) 28,837,671 4,232,900 (2,531,129) 5,320,661 32,441,851 298,417,973 970,539 27,928,314 (215,891,104) (47,573,724) 63,851,998 (48,791,219) 15,060,779 (45,118,041) (20,870,726) 720,448 4,843,152 11,183 2,731,464 (164,065,492) (221,748,012) 32,713,205 (712,333) 227,000,000 (28,837,671) 230,163,201 23,475,968 213,883,303 237,359,271 23,475,968

Cash flow from Financing Activities Increase in borrowings (Net) Dividend Paid Proceeds from fresh issue Interest Paid Net cash flow from financing activities C Net Increase in cash and Cash equivalents (A+B+C) Cash and Cash equivalents at the beginning of the period at the end of the period Net Increase in cash and Cash equivalents
Cash and cash equivalents are as per schedule 6 to the financial statements (adjusted for the Book Overdraft)

Significant accounting policies and notes to accounts As per our attached report of even date For Chaturvedi & Shah. Chartered Accountants Rajesh D. Chaturvedi Partner Place: Mumbai Date : September 12, 2007

14 For and on behalf of the Board

Urrshila A. Kerkar Director Place: Mumbai Date : September 12, 2007

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Peter Kerkar Director

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COX & KINGS (INDIA) LIMITED Schedules forming part of the Balance Sheet as at March 31, 2007 As At 31.03.2007 Rupees SCHEDULE 1 - SHARE CAPITAL AUTHORISED 10,000,000 Equity Shares of Rs.10/- each ISSUED, SUBSCRIBED & PAID UP 5,440,000 Equity Shares of Rs.10/- each fully paid up (Of the above, 98,500 Equity Shares of Rs.10/- each were issued pursuant to a contract without payment being received in cash) TOTAL SCHEDULE 2 - RESERVES & SURPLUS CAPITAL RESERVE As per last Balance Sheet SECURITY PREMIUM: As per last Balance Sheet Add : On Shares allotted during the year 211,000,000 29,400,000 181,600,000 211,000,000 FOREIGN EXCHANGE EARNINGS RESERVE: As per last Balance Sheet BALANCE IN PROFIT & LOSS ACCOUNT TOTAL 5,617,080 475,452,667 693,819,747 5,617,080 274,398,183 492,765,263 211,000,000 1,750,000 1,750,000 Rupees As At 31.03.2006 Rupees Rupees

100,000,000 100,000,000 54,400,000

100,000,000 100,000,000 54,400,000

54,400,000

54,400,000

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COX & KINGS (INDIA) LIMITED Schedules forming part of the Balance Sheet as at March 31, 2007 As At 31.03.2007 Rupees SCHEDULE 3 - LOAN FUNDS (I) SECURED LOANS a) Bank Overdraft b) Loans from Banks [(Amount repayable within a year Rs. 74,720,272/-; (Previous year Rs. 105,032,657/-)] Rupees As At 31.03.2006 Rupees Rupees

272,066,305

163,312,488 294,150,450

272,066,305 (II) UNSECURED LOANS a) Inter-Corporate Deposits [Rs. 50,000,000/- (Previous year Rs.96,400,000/-) is repayable within one year] b) Non-convertible Debentures [25 Debentures of Face value of Rs. 10,000,000/redeemable at par in 2 equal instalments; the earliest redemption date being 30th November 2007] TOTAL 300,000,000 572,066,305

457,462,938

50,000,000

185,900,000

250,000,000

185,900,000 643,362,938

Notes: 1) Loan refered to in I (a) above are secured against Hypothecation of Book Debts of not over 90 days old, and all moveable assets. 2) Loan refered to in I (b) above : a) Loan to the extent of Rs.133,994,102/- (previous year Rs.170,941,578/-) is secured against Execution of Demand Promissory Note, Hypothecation Companys movable and immovable assets, Shares of Group Company, Personal Guarantee of a Director b) Loan to the extent of Rs. 132,316,787/- (Previous year Rs. 116,294,668/-) is secured against credit card receivables; second charge against the current assets of the company, present and future and Personal Guarantee of a Director. c) Loan to the extent of Rs.5,755,416/- (previous year Rs.6,914,204/-) is secured against respective vehicles purchased.

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SCHEDULE - 4 DEPRECIATION/ AMORTISATION As on 31.03.2007 For the Year ( Rs. ) ( Rs. ) ( Rs. ) ( Rs. ) ( Rs. ) Sale / ADJ ( Rs. ) ( Rs. ) UPTO 01.04.2006 UPTO 31.03.2007 As on 31.03.2007 As on 31.03.2006 NET BLOCK

GROSS BLOCK Sale / ADJ ( Rs. )

Particulars

As on 01.04.2006

Additions

( Rs. )

( Rs. )

Tangilble 4,608,431 2,111,708 72,534,528 19,688,285 22,294,507 49,087,319 14,947,911 15,372,472 6,230,317 2,020,192 647,258 5,576,967 19,489,963 5,294,590 113,575 12,618,738 1,210,933 13,829,671 24,670,978 6,224,225 8,250,509 7,568,546 9,217,238 1,648,692 41,924,336 50,349,559 8,425,223 22,184,969 10,471,047 8,464,836 24,416,341 8,723,686 7,121,963 709,247 779,370 1,332,338 70,123 412,139 4,196,292 396,665 360,985 51,154 4,247,446 1,402,461 12,519,817 11,310,913 7,440,159 27,797,148 10,371,807 7,116,895

4,608,431

2,111,708

54,444,153

18,090,375

18,879,459

808,826

20,058,897

2,235,610

47,287,111

2,196,873

Lease Hold Land Resedential Flats Computer and Printers Electrical Installations & Fittings Office Equipments Furniture & Fixtures LeaseHold Improvements

11,019,065

3,928,846

Vehicles

13,347,212

2,025,260

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Intangible 9,536,727 48,161,014 258,342,902 258,342,902 181,292,763 96,225,101 94,695,407 396,665 396,665 21,468,423 6,675,711 1,907,345 3,741,092 8,583,056 3,741,092 953,671 44,419,922 113,575 126,057,837 132,285,065 29,946,311 18,044,761 5,677,662 2,861,016 85,067,662 45,701,451 113,575 126,057,837 137,962,727 130,769,113 16,515,075 96,225,093 130,769,121

Database

9,536,727

Softwares

48,161,014

TOTAL

181,292,763

77,446,804

96,225,101 29,946,311.00

Annual Report 2007

Add: Capital Work In Progress (Intangible)

Total

181,292,763

77,446,804

PREVIOUS YEAR

157,643,145

45,118,041

Cox & Kings

Notes: (1) Cost of Residential Flats include 3,676 shares of Rs. 10/- each fully paid up in Century Galaxy Developers Limited.

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COX & KINGS (INDIA) LIMITED Schedules forming part of the Balance Sheet as at March 31, 2007 As At 31.03.2007 Rupees SCHEDULE 5 - INVESTMENTS (LONG TERM - AT COST, UNLESS OTHERWISE STATED) A. TRADE INVESTMENTS Unquoted : In Subsidiary : Clearmine Limited 1,500 (Previous year 1,500) Equity shares of Sterling pound 1/each fully paid up CNK Internet Pte Limited 100,000 (Previous year Nil) Equity shares of SGD 1/- each fully paid up Cox AND KINGS Tours LLC 300 (Previous year Nil) Equity shares of AED 1,000/- each fully paid up In Others: Radius Global Travel Company 1 Share (Previous year 1) of USD 12,500 each Greater Bombay Co-Op Bank Limited 40 shares (Previous year 40) at Rs. 25 each Tulip Hospitality Services Limited 1,800,000 (Previous year 1,800,000) 11% Convertible Debentures of Rs 100/- each Ezeego One Travels and Tours Private Limited 9,000 (Previous year NIL) Equity Share of Rs.10/- Each fully Paid up Ezeego One Travels and Tours Private Limited 100,000 (Previous year NIL) 12% Fully Convertible Debentures of Rs. 1000/- each Quoted : Tulip Star Hotels Limited 1,402,500 (Previous year 1,402,500) Equity Shares of Rs.10/each fully paid-up (The above shares are pledged with Bank) B. OTHERS Unquoted : Business India Publications Limited 45,000 (Previous year NIL) Equity shares of Rs 10/- each fully paid up CURRENT INVESTMENTS Unquoted - Others: LIC Mutual Fund 4,555,521.83 units of Rs. 10 each fully paid up TOTAL Note: Quoted Investments : Cost Market Value Aggregate Cost of Unquoted Investments 67
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As At 31.03.2006 Rupees Rupees

Rupees

163,389,379

161,590,492

2,882,750

3,672,000

612,063 1,000 180,000,000

612,063 1,000 180,000,000

100,000,000

100,000,000

14,025,000

14,025,000

2,475,000

2,475,000

50,010,043 617,067,235

358,703,555

14,025,000 84,851,250 603,042,235

14,025,000 70,826,250 344,678,555

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Cox & Kings

COX & KINGS (INDIA) LIMITED Schedules forming part of the Balance Sheet as at March 31, 2007 As At 31.03.2007 Rupees SCHEDULE 6 - CURRENT ASSETS, LOANS AND ADVANCES CURRENT ASSETS INVENTORIES Stock of Foreign Currency SUNDRY DEBTORS ((Unsecured, Considered Good)) Debts Outstanding for period exceeding six months Others CASH AND BANK BALANCES Cash on Hand Balances with Banks With Scheduled Banks in Current Accounts in Escrow Account in Fixed Deposit pledged with Banks With Other Banks Deutsche Bank Trust Company Americas New York [Maximum Balance Outstanding during the year Rs.35,852,788/- (Previous Year Rs 3,895,533/-)] 154,155,144 LOANS AND ADVANCES (Unsecured, Considered Good) Advances to Subsidiaries Advances recoverable in cash or in kind or for value to be received Share Application money Sundry Deposits Advance Taxes paid TOTAL 265,987,249 91,545,410 6,685,823 3,106,660 1,694,011 230,406,302 1,603,916 15,144,281 491,894 12,607,001 728,150,949 740,757,950 51,123,240 18,340,856 12,886,654 432,571,330 445,457,984 Rupees As At 31.03.2006 Rupees Rupees

18,945,410

11,441,768

3,547,691 692,579,812 5,304,000 39,677,814 202,925,452 944,034,769 1,857,893,273

772,207,618 37,771,842 79,352,844 889,332,304 1,612,219,305

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COX & KINGS (INDIA) LIMITED Schedules forming part of the Balance Sheet as at March 31, 2007 As At 31.03.2007 Rupees SCHEDULE 7 - CURRENT LIABILITIES AND PROVISIONS A. CURRENT LIABILITIES Trade Creditors : i) Total outstanding dues to small scale industrial undertakings ii) Total outstanding dues of creditors other than small scale industrial undertakings Interest Accrued not due Other Liabilities Book Overdraft Unclaimed Dividend (Due to Investor Education Fund) B. PROVISIONS Provision for Direct Taxes Provision for Fringe Benefit Tax Provision for Leave Encashment Provision for Gratuity Proposed Dividend Tax on Proposed Dividend TOTAL Rupees As At 31.03.2006 Rupees Rupees

186,859,891 288,479 740,458,663 97,991,555 6,020 1,025,604,608 244,050,000 11,415,000 8,064,698 11,440,639 3,808,000 534,072 279,312,409 1,304,917,017

257,841,808 495,076,095 28,627,978 6,020 781,551,901 119,550,000 6,215,000 12,154,711 10,179,582 3,808,000 534,072 152,441,365 933,993,266

Note: a) The Company has not received the required information from Suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006. Hence, disclosures relating to amounts unpaid as at the year end together with interest paid /payable as required under the said Act have not been made. b) Based on the information available with the company there are no dues from small scale industrial undertaking. SCHEDULE 8 - MISCELLANEOUS EXPENDITURE (to the extent not written off or adjusted) Deferred Revenue Expenditure: (i) Expenditure on promotion of specific branded products As per last Balance Sheet 17,640,308 Less: Written off during the year 17,640,308 TOTAL -

50,082,159 32,441,851 17,640,308 17,640,308

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Annual Report 2007

Cox & Kings

COX & KINGS (INDIA) LIMITED Schedules forming part of the Balance Sheet as at March 31, 2007 As At 31.03.2007 Rupees SCHEDULE 9 - COMMISSION & OTHER OPERATING INCOME Travel and Tours Commission 854,057,593 Income from Forex Division 37,368,139 TOTAL SCHEDULE 10 - OTHER INCOME OTHER INCOME Interest on Deposits (Gross) [T.D.S. Rs.130,725/-; (Previous year Rs.45,554/-)] Interest on Convertible Debentures [T.D.S. Rs.4,667,520/-; (Previous year Rs.4,443,120/-)] Profit on Sale of Fixed Assets Dividend on Long Term Investments Profit on sale of Investments Miscellaneous Income TOTAL SCHEDULE 11 - PERSONNEL EXPENSES PERSONNEL EXPENSES Salaries, Wages, Bonus and Allowances Contribution to Provident and Other Funds Payment / Provision for Gratuity Staff Training & Welfare Expenses TOTAL 2,322,696 23,705,227 23,705,227 181,944 11,183 2,531,129 2,811,329 25,735,617 25,735,617 Rupees As At 31.03.2006 Rupees 596,935,189 34,778,946 891,425,732 891,425,732 631,714,135 631,714,135 Rupees

582,531 20,800,000

400,032 19,800,000

145,472,492 9,052,626 2,581,155 11,271,027 168,377,300 168,377,300

127,221,387 9,634,753 2,611,224 11,358,598 150,825,962 150,825,962

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Annual Report 2007

COX & KINGS (INDIA) LIMITED Schedules forming part of the Balance Sheet as at March 31, 2007 As At 31.03.2007 Rupees SCHEDULE 12 - OTHER EXPENSES OTHER EXPENSES Rent Rates & Taxes Electricity Expenses Repairs & Maintenance for : Buildings Others 850,697 3,709,180 4,559,877 6,664,565 40,951,298 11,952,136 4,876,473 23,404,337 249,887 33,500,852 490,811 168,090 141,191,923 6,416,245 265,000 8,422,349 2,939,785 1,348,320 32,772 20,835 1,401,927 Amortisation of Expenditure on Promotion of Specific Branded Products TOTAL SCHEDULE 13 - INTERST AND FINANCE CHARGES (NET) On Fixed Loans Others* TOTAL * Including Bank and Other Charges. 338,653,363 312,252,885 17,640,308 1,140,242 41,266 1,181,508 32,441,851 788,518 7,396,292 8,184,810 5,084,235 36,990,718 5,320,661 10,281,521 3,841,680 17,731,595 28,930 36,998,548 3,023,434 4,414,844 101,525,886 5,570,170 308,498 4,664,353 1,178,398 Rupees As At 31.03.2006 Rupees Rupees

25,175,732 616,892 7,764,876

25,007,604 875,565 7,598,076

Insurance
Communication & Courier Expenses Bad Debts Printing & Stationery Books, Periodicals & Subscriptions Legal & Professional Fees Filing and Registration Fees Travelling & Conveyance Exchange Fluctuation Loss (Net) Loss on Sale of Assets Advertisement, Publicity & Business Promotion General Expenses Donations Computer Expenses Security Charges Auditors' Remuneration: Statutory Audit Other services Taxation Matters Out of Pocket Expenses

48,722,380 1,425,705 50,148,085 50,148,085

27,201,782 1,691,890 28,893,672 28,893,672

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Annual Report 2007

Cox & Kings

SCHEDULE 14 Notes to the Accounts for the year ended March 31, 2007 1. SIGNIFICANT ACCOUNTING POLICIES a. Method of Accounting The financial statements are prepared as per historical cost convention on accrual basis and comply with the provisions of the Companies Act, 1956, the generally accepted accounting principles in India and the applicable accounting standards issued by the Institute of Chartered Accountants of India. b. Use of Estimates The preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of the assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/ materialized. c. Turnover In line with generally accepted accounting practices, turnover comprises of net commissions earned on travel management, service agency charges including margins in respect of tour and tour related services and commissions/margins earned on foreign exchange transactions in the normal course of the business as Authorised Dealer. The income arising from the buying and selling of foreign currencies has been included on the basis of margins achieved.. d. Revenue Recognition In accordance with the Companys accounting policy followed consistently, commissions/income arising from tours and related services is accounted after netting off all direct expenditures relating thereto. Income from buying and selling of foreign currencies is accounted on net basis as stated in (b) above. All revenues are accounted when there is reasonable certainty of its ultimate collection. e. Expenditure All general business expenditure is accounted in the year in which it is incurred. All direct tour related expenses including advertisement expenses for specific tour are accounted in the year in which the tours are undertaken. f. Fixed Assets Fixed Assets are stated at cost, less accumulated depreciation. Costs include all costs relating to acquisition and installation of fixed assets. Intangible assets represent customer data base and contacts, stated at the valued amount and Software stated at cost g. Depreciation Depreciation on fixed assets is provided on the written down value method at the rates prescribed under Schedule XIV to the Companies Act, 1956. Intangible assets are amortised over a period of five to ten years, being the expected period of use. The leasehold land and leasehold improvements are depreciated over the lease period. h. Leases Assets acquired under finance leases on or after April 1, 2001 and hire purchase finance taken prior to April 1, 2001 are capitalized as fixed assets at their fair value at the inception of the lease. Depreciation on such assets is provided as per the companys policy stated above. Lease payments are apportioned and the finance charge is recognized in the profit and loss account. i. Investments Long-term investments are valued at cost. Provision for diminution in value of investments is made, if the diminution is of a nature other than temporary. Current investments are valued at the lower of cost and market value. j. Inventory Inventory represents stock of foreign currencies, which have been valued at lower of cost and realisable value as at the yearend. k. Provision for leave encashment and gratuity Provisions for leave encashment on retirement/separation and gratuity are accounted for based on the valuation, as at the yearend, done by independent actuaries.
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l. Foreign Currency Transactions Transactions in foreign currency are recorded at spot rates / average rates. Current assets/liabilities including those pertaining to foreign branch are converted at year-end rates. Gains or losses arising out of realisations or translations at the year-end are recognised in the profit & loss account for the year. m. Accounting for taxes on Income Provision for current tax is made, based on the tax payable under the relevant statute. Deferred tax on timing differences between taxable income and accounting income is accounted for, using the tax rates and the tax laws enacted or substantially enacted as on the balance sheet date. Deferred tax assets are recognized only to the extent that there is a reasonable certainty of its realisation. n. Provision, Contingent Liabilities and Contingent Assets Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements. 2. CONTINGENT LIABILITIES a) Guarantees given by banks Rs 9,112,390/-(Previous Year Rs 10,556,750/-) b) Claims against the Company not acknowledged as debts estimated at Rs.35,887,884/- (Previous Year 31,970,794/-) c) Disputed income tax demand Rs 35,662,928/- (Previous Year 34,943,465/-). The Company has made advance payment of Rs 7,661,135/- (Previous Year-7,089,086/-) against the same. 3. Unsecured loan to the extent of Rs. 25 Crores is secured by personal guarantee of a director 4. CAPITAL COMMITMENTS (Net of Advances) Estimated amount of contracts remaining to be executed on capital account other than above and not provided for in accounts is Rs NIL (Previous year Rs 299,735/-). 5. Until previous year, expenditure incurred by the Company upto March 31, 2004 for promotion of specific branded products viz. Duniya Dekho, Bharat Dekho and Flexi Hols to establish the brands in the markets was amortized over a five-year period. To comply with Accounting Standard (AS) 26 on Intangible Assets issued by the Institute of Chartered Accountants of India, the Company has changed the policy and written off the balance unamortised amount of Rs 17,640,308/- (Previous year Rs 32,441,851/-). Had there been no change in the aforesaid accounting policy, the profits for the year and balance in profit & loss account would have been higher by Rs.4,411,385/6. Advances include amount due from: i. A company under the same management Name of Company
Ezeego One Tours & Travels Private Limited

Balance as on 31st March 2007 Rs.84,835,275/-

Maximum amount during the year Rs.84,835,275/-

ii.

A private limited companies in which a director is a member/director Balance as on 31st March 2007 Rs.67,492,294/Maximum amount during the year Rs.67,492,294/-

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Annual Report 2007

Cox & Kings

7. Break up of Deferred Tax liability is as under. As at March 31, 2007 Rs. I) Deferred Tax Liability (DTL) i) Additional Depreciation on fixed assets for tax purposes due to higher tax depreciation rates ii) Deferred Revenue Expenditure claimed as expense for tax purposes Total II) Deferred Tax Asset (DTA) i) Additional Depreciation on fixed assets for tax purposes due to higher tax depreciation rates ii) Provision for Leave encashment and Gratuity that are deducted for tax purposes when paid iii) Other disallowable items Total I-II) Total Deferred Tax Liability / (Asset) (Net) 6,565,496 7,686,152 14,251,648 (12,279,834) 295,356 7,517,723 3,313,827 11,126,906 (5,189,178) 1,971,814 1,971,814 Nil 5,937,728 5,937,728 As at March 31, 2006 Rs.

8. Particulars of earnings per share Particulars Net profit after tax* Weighted Average number of equity shares outstanding during the period. Nominal value per share Earning per share * Excluding tax adjustments in respect of earlier years. 9. Expenditure in Foreign Currency Nature Travelling Subscription Legal and professional fees Advertisement Total 10. Income in Foreign Currency Nature Travel, Tour and other receipts (As certified by Bankers) Total For the Year Ended 31.03.2007 (Rs.) 629,435,952 629,435,952 For the Year Ended 31.03.2006 (Rs.) 630,793,297 630,793,297 For the Year Ended 31.03.2007 (Rs.) 3,701,649 4,248,218 8,838,748 3,353,914 20,142,529 For the Year Ended 31.03.2006 (Rs.) 5,153,160 4,711,556 4,099,683 13,964,399 For the Year ended 31.03.2007 205,396,552 5,440,000 10 37.76 Amount in Rs. For the Year Ended 31.03.2006 149,007,186 4,683,333 10 31.82

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Annual Report 2007

11. Remittances in foreign currency for dividends Particulars Number of non resident shareholders (in respect of whom the remittance is made) Number of shares held by them Gross amount of dividend (Rs) Amount deposited in their bank accounts in India Remittances in foreign currency 12. Lease Liability Lease Obligations Repayable within 1 year Repayable more than 1 year to 5 year (Figures in bracket pertains to previous year) 13. Related party disclosures with respect to transactions during 2006-07: List of Related parties: Associates: Liz Investments Private Limited Tulip Star Hotels Ltd. Subsidiaries/Fellow Subsidiary Clearmine Limited ETN Services Limited CNK Internet PTE Ltd (With effect from 15th May, 2006) Cox & Kings Tours ( L.L.C) (With effect from 7th February, 2007) Key Management Personnel Mr. A.B.M Good Chairman Mr.Peter Kerkar Director Ms.Urshila Kerkar Director Mr. Arup Sen Director Relatives of key Management Personnel Dr. A.B.Kerkar Mrs Elizabeth Kerkar Enterprises over which Key Management Personnel and their relatives exercise significant influence Far Pavilions Tours and Travels Limited. Good Relations (India) Limited Ezeego One Travels and Tours Private Limited Repayable NIL (2,960,100) NIL (3,954,104) Minimum Lease obligations NIL (2,960,100) NIL (3,954,104) Nil 451,962 Nil 224,000 For the Year ended 31.03.2007 (Rs.) 3 645,660 For the Year Ended 31.03.2006 (Rs.) 1 320,000

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Cox & Kings

Transactions with related parties Nature of transaction Subsidiaries

Companies Key having substantial Management interest personnel Rs. Lacs (-) (-) 10.59 (10.59) Rs. Lacs (-) 13.16 (9.00) 9.00 4.16 9.13 (14.42) 6.54 2.59

Relative of Key management personnel Rs. lacs (-) (-) 1.76 (1.77) 1.11 0.65

Enterprises over which key management personnel or their relatives have significant influence Rs. lacs (-) (-) (-)

Purchase ETN Services Ltd Remuneration Urrshila Kerkar Arup Sen Dividend Peter Kerkar Urrshila Kerkar E. A. Kerkar Dr. A. B. Kerkar Liz Invetments Investment Clearmine Ltd CNK Internet PTE Ltd Cox & Kings Tours ( L.L.C) Ezeego One Tours & Travels Private Limited Interest paid Tulip Star Hotels Ltd Interest received Tulip Star Hotels Ltd Liz investments Private Ltd Far Pavilion Tours & Travels Ltd Ezeego One Tours & Travels Private Limited Loans/Advances Given CNK Internet PTE Ltd Cox & Kings Tours ( L.L.C) Liz investments Private Ltd

Rs. Lacs 1627.85 (-) (-) (-)

1699.43 (1615.90) 1633.89 28.82 36.72 (-) (-)

10.59 (-)

(-)

(-)

2000.00 (-)

2000.00 87.83 (98.45) 23.34 (-) 16.52 6.82 (-) (-) (-) (-) (-) 89.60 (41.36)

76.30 13.30 35.48 (-) 7.75 27.73 42.35 (-) (-) (-) 499.76 (826.58)

40.75 159.53 91.30 407.63 75.14 (31.71) (-) (-) 1450.81 (103.55)

Tulip Star Hotels Ltd. Far Pavilion Tours & Travels Ltd Ezeego One Tours & Travels Private Limited Outstanding balance [170.64] debit/[Credit] (-) ETN Services Ltd [206.12] CNK Internet PTE Ltd 7.75 Cox & Kings Tours ( L.L.C) 27.73 Liz Investments Private Ltd Tulip Star Hotels Ltd. Far Pavilion Tours & Travels Ltd Ezeego One Tours & Travels Private Limited Figures in bracket represents previous year figure.

72.46 268.46 601.63 848.35

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14. Directors Remuneration: Particulars Salary and allowances PF and Gratuity 2006-07 (Rs. In lacs) 11.45 1.71 2005-06 (Rs. In lacs) 11.27

15. The Company operates in only one business segment, namely Tours and Travel. 16. In the opinion of the Board of Directors, the current assets and loans & advances have a value on realisation in ordinary course of business at least equal to the amount at which they are stated. 17. Information as required under Part II of Schedule VI of the Companies Act, 1956 is given to the extent applicable. 18. Particulars required to be furnished in terms of Part IV of Schedule VI to the Companies Act, 1956 is enclosed in the Annexure. 19. Previous years figures have been regrouped / rearranged where necessary to conform to current years classification. Signatures to Schedules 1 to 14 For Chaturvedi & Shah. Chartered Accountants Rajesh D. Chaturvedi Partner Mumbai: Dated : September 12, 2007

For and on behalf of the Board

Urrshila A. Kerkar Director

Peter Kerkar Director

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